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What is happening in Arequipa’s real estate market? Are prices on the rise or decline? Is Arequipa still attracting foreign investors? How are local government policies and taxes shaping the real estate landscape in 2025?
These are the questions we hear every day from professionals, buyers, and sellers alike, from the historic center to the surrounding districts. Perhaps you’re curious about these trends too.
We know this because we stay closely connected with local experts and individuals like you, exploring the Arequipa real estate market daily. That’s why we crafted this article: to offer clear answers, insightful analysis, and a comprehensive view of market trends and dynamics.
Our aim is straightforward: to make sure you feel informed and confident about the market without needing to search elsewhere. If you think we missed something or could improve, we’d love to hear your feedback. Feel free to message us with your thoughts, and we’ll strive to enhance this content for you.

1) Central Arequipa will see higher rental yields as demand for short-term rentals rises
Rental yields in central Arequipa are set to rise as more tourists seek short-term rentals.
In 2023, Arequipa saw a 25% increase in tourist arrivals, and this trend is expected to continue. With more visitors, the need for short-term accommodations is naturally growing. This surge is largely fueled by the city's rich cultural heritage and stunning landscapes, making it a hot spot for travelers.
Platforms like Airbnb are booming in Arequipa, with 1,273 active listings as of September 2024. This reflects the growing interest in short-term rentals. The median occupancy rate stands at 45%, showing a robust market where these rentals are in demand.
Short-term rentals in Arequipa often offer higher returns than traditional leases. They can generate twice the revenue, making them a lucrative option for property owners. This potential for increased earnings is likely to draw more investors, boosting rental yields further.
Investors are particularly attracted to the flexibility and profitability of short-term rentals. With the ability to adjust pricing based on demand, property owners can maximize their income, unlike with fixed long-term leases.
As Arequipa continues to attract tourists, the demand for short-term rentals will likely keep rising, making it a promising market for property investors.
Sources: Airbtics, Global Property Guide
2) Affordable housing yields will stay stable as local family demand remains consistent
In 2025, affordable housing yields in Arequipa will stay stable thanks to a steady demand from local families.
Arequipa's population is on the rise, with the metro area reaching 971,000 people in 2024, a 1.25% increase from the previous year. This growth is expected to continue, fueling the need for more housing. Local families are the main drivers of this demand, as they look for homes in a city that's becoming increasingly appealing.
Infrastructure upgrades and new projects are popping up all over Arequipa, making it even more attractive. These changes are drawing in both locals and newcomers, which in turn boosts the demand for housing. The city's average gross rental yield is 5.99%, a figure that has stayed stable compared to other Peruvian cities, reflecting a healthy real estate market.
By 2025, the demand for residential properties in Arequipa is expected to grow by 15% due to urbanization. This uptick is a clear indicator that local families are on the hunt for affordable housing, keeping yields steady. The city's young and expanding population is a big part of this trend, as it often leads to more families forming and needing homes.
Arequipa's real estate market is benefiting from these dynamics, with local families consistently seeking housing options. This ongoing demand ensures that the market remains robust and yields stay stable. The city's appeal is only set to increase with these developments, making it a promising spot for property investment.
Sources: Macrotrends, Global Property Guide

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Peru versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
3) Student influx will boost demand for rentals near universities
The influx of students will increase demand for rental properties near universities in Arequipa.
With over 27,000 students enrolled, the Universidad Nacional de San Agustín de Arequipa (UNSA) is a major hub of activity. This large student body naturally creates a high demand for housing options close to campus. As more students join each year, the need for nearby accommodation becomes even more pressing.
Arequipa is not just about its universities; the city is experiencing a rapid urban boom. Economic opportunities and the city's charm are drawing more people, including students, to settle here. As the population grows, so does the demand for housing, especially rental properties near educational institutions.
Many students prefer off-campus living, which is becoming a trend. This preference is fueling the demand for rental properties in areas surrounding universities. Students are looking for convenience and proximity, making these areas highly sought after.
As Arequipa continues to grow, the city's infrastructure and amenities are also improving. This development makes the city even more attractive to students and new residents alike, further increasing the demand for housing.
With the combination of a growing student population and urban expansion, rental properties near universities are becoming prime real estate. Investors and property owners are taking note, seeing the potential for steady rental income.
Sources: EduRank, 4icu.org, Top Universities
4) Eco-friendly home demand will increase with growing environmental awareness
In Peru, nearly half of homebuyers are now keen on sustainable living options.
This shift is partly due to the rise of sustainable building materials like WPC panels, which combine wood fibers and recycled plastics. These materials are not only durable and attractive but also environmentally friendly, making them a favorite among builders and homeowners.
The Peruvian government is also playing a big role by promoting energy-efficient homes through programs like MiVivienda Verde. This initiative offers financial incentives, making eco-friendly homes more accessible and appealing to environmentally conscious buyers.
Media coverage on sustainable living is another factor boosting demand. As environmental issues gain more attention, society is shifting towards eco-conscious living, and the real estate market is following suit. Homes with green certifications are now selling as fast, if not faster, than traditional homes.
In the real estate market, green-certified homes are becoming increasingly popular, reflecting a broader societal trend towards sustainability. This trend is not just a passing phase but a growing movement that aligns with global environmental goals.
As environmental awareness grows, demand for eco-friendly homes is expected to rise, making them a smart investment for the future.
Sources: NAR Realtor, CRH Ventures, Hosung Deck
5) Arequipa's luxury market will attract more foreign buyers thanks to favorable exchange rates
Favorable exchange rates are making Arequipa's luxury properties more appealing to foreign buyers.
In recent years, the Peruvian sol has fluctuated, making foreign currencies more attractive and boosting interest in high-end real estate. This trend is particularly noticeable in Arequipa, where the luxury market is seeing increased attention from international investors.
The Peruvian government has been working hard to create a business-friendly environment, which has led to a rise in Foreign Direct Investment (FDI). While agriculture is a major focus, this investment trend is also spilling over into the real estate sector, including luxury properties in Arequipa.
Economic forecasts are optimistic, with the Central Reserve Bank of Peru predicting positive growth rates for 2025. This outlook suggests that the conditions will remain favorable for foreign buyers looking to invest in Arequipa's luxury market.
Insider knowledge suggests that Arequipa's unique blend of colonial architecture and modern amenities is a big draw for international buyers. The city's charm, combined with favorable economic conditions, makes it a prime location for luxury real estate investment.
With the current economic climate, foreign buyers are likely to continue showing increased interest in Arequipa's luxury market, driven by advantageous exchange rates and a welcoming investment environment.
Sources: LatinCarib, Central Reserve Bank of Peru
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6) Foreign investment in suburban developments will increase as investors look for long-term growth
Foreign investment in suburban developments is on the rise, especially in places like Arequipa.
Arequipa is becoming a hotspot for expats, thanks to its affordable cost of living and a charming mix of traditional culture and modern amenities. This influx of expats is driving up demand for suburban housing, making it a prime target for international investors.
The Peruvian government is quite welcoming when it comes to foreign property ownership. There are no legal restrictions for foreigners buying property, which makes the real estate market even more attractive. Add to that the improved infrastructure and transportation links, and you have suburban areas that are both accessible and appealing for investment.
Peru's economic outlook is another reason investors are eyeing suburban developments. With positive economic forecasts and new mining projects on the horizon, property values in these areas are expected to rise. This offers a promising opportunity for those looking to invest long-term.
Investors are particularly interested in Arequipa because of its potential for growth. The city's blend of old and new, along with its strategic location, makes it a compelling choice for foreign investors seeking stable returns.
As the economy grows and infrastructure improves, suburban property values are likely to increase, making it a smart move for those looking to invest in the future.
Sources: Macrotrends, Moving Countries Guide, Expat Focus
7) International buyers will target properties with strong short-term rental potential
International buyers are eyeing properties in Arequipa for their strong short-term rental potential.
Arequipa is gearing up to welcome a surge of tourists, with over 300,000 visitors expected in early 2025. Popular spots like Camaná and Mollendo are set to boost the local economy by S/ 20 million, creating a high demand for short-term rentals. This influx is a golden opportunity for those looking to invest in rental properties.
Platforms like Airbnb are already showing promising signs. In Arequipa, the median occupancy rate is 45%, with an average daily rate of PEN9. A typical Airbnb listing is booked for 164 nights a year, bringing in an annual revenue of PEN1K. This makes short-term rentals a more lucrative option compared to long-term leases.
Arequipa's charm as a travel destination adds to its investment appeal. Known for its stunning beaches and vibrant culture, the city also boasts a UNESCO World Heritage Site in its historical center. This rich cultural backdrop draws tourists, increasing the demand for short-term accommodations.
Infrastructure development is another key factor. Arequipa is preparing for the summer season with improved lodging, restaurants, and health certifications, ensuring a safe and enjoyable experience for tourists. This well-prepared infrastructure supports the growth of the short-term rental market.
With these elements in play, international buyers are likely to focus on properties that offer strong rental potential, especially those catering to the short-term stay market. Arequipa's vibrant tourism scene and infrastructure readiness make it a promising investment destination.
Sources: Trexperience Peru, Airbtics, Wikipedia
8) Arequipa’s property prices will rise moderately with steady demand
Arequipa's property market is buzzing with activity as more people look to buy homes.
With a median sales price of about S/1,890,000 and a price per square meter at S/3,480, the demand for housing is clearly on the rise. This uptick in sales shows that Arequipa is becoming a hot spot for homebuyers.
One big reason for this demand is the significant population growth in the area. Arequipa's economy, especially its booming mining sector, is drawing people in for job opportunities, which naturally boosts the need for housing.
Arequipa is not just growing in population; it's also one of Peru's fastest-growing regions economically. Investments in infrastructure, like hydroelectric dams and hospitals, are making life better here, attracting even more potential residents.
Urban expansion is another key factor. New residential projects and developments, such as the Mallplaza Arequipa, are thriving, indicating a strong preference for homeownership among both locals and newcomers.
Overall, residential property prices in Arequipa will see a moderate increase due to steady demand, driven by economic growth and urban development.
Sources: Global Property Guide, Oxford Business Group, FazWaz, Institutional Presentation 1Q2024

We have made this infographic to give you a quick and clear snapshot of the property market in Peru. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
9) Suburban rental yields will dip slightly as new developments increase competition
Arequipa's housing market has been buzzing with new developments in 2023 and 2024.
With so many new homes popping up, there are more rental units than tenants to fill them. This has left many suburban landlords scratching their heads as they see more empty properties. To attract tenants, rental prices have been dropping, which is squeezing rental yields.
Real estate agents are noticing that landlords are in a bit of a race, trying to outdo each other with lower prices. Meanwhile, tenants are eyeing the shiny new developments, leaving older suburban rentals in the dust. This shift in tenant interest is making it even tougher for suburban landlords.
With the focus on new builds, suburban rental yields are feeling the pinch. The competition is fierce, and landlords are having to rethink their strategies to keep up. It's a challenging time for those with properties in the suburbs.
As the market continues to evolve, landlords are finding themselves in a tight spot. The oversupply of rental units is not just a temporary blip; it's reshaping the rental landscape in Arequipa.
For anyone considering buying property here, it's crucial to understand these dynamics. The current trends suggest that suburban rental yields might not be as lucrative as they once were.
Sources: Global Property Guide, Construction Coverage
10) Property values in Alto Selva Alegre will rise with ongoing urban renewal projects
The Alto Selva Alegre district is on the brink of a property value surge due to ongoing urban renewal projects.
These projects are fueled by increased investment from PROINVERSIÓN, the Private Investment Promotion Agency, which has teamed up with district municipalities. Their focus is on social housing and public infrastructure, showing a strong commitment to making the area more appealing.
In Arequipa, the real estate market is buzzing, with mid-range residential property prices expected to rise by 9% by 2025. This trend is driven by local demand and infrastructure upgrades, and it's likely to spill over into Alto Selva Alegre, making it a hot spot for buyers and investors.
Government backing is a big deal here. The collaboration between PROINVERSIÓN and the municipalities means ample resources and attention are being funneled into the district's infrastructure and amenities, which is a win for property values.
For those eyeing property in the area, this is a golden opportunity. The district's transformation is not just about new buildings; it's about creating a vibrant community with improved living standards.
As these projects progress, the district is set to become a more attractive place to live, work, and invest, with enhanced infrastructure and community facilities leading the charge.
Source: Invest in Peru
11) Affordable housing rents will stay stable due to local demand
Affordable housing rents in Arequipa are stable thanks to a growing local population.
In 2024, Arequipa's metro area population hit 971,000, a 1.25% rise from 2023. This steady increase means more people need homes, keeping the demand for housing strong.
Arequipa's economy also plays a big part. Even though there was a 5.1% drop in the employed population in 2023, the city still has a solid workforce. Various industries support this, and a lot of people work informally, which helps keep rental demand up.
Migration trends add to this stability. Arequipa is a magnet for domestic migrants looking for jobs, which boosts the need for rental homes. Despite fewer employed people in 2023, the city's economic activities continue to attract folks from other areas, ensuring a steady demand for affordable housing.
Locals know that Arequipa's charm and job opportunities make it a popular choice for many. This ongoing influx of people keeps the rental market lively and competitive.
Sources: Macrotrends, Gob.pe
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12) City center rents will rise as more professionals seek closeness to work and amenities
Rents in Arequipa's city center are set to rise as more professionals flock to the area for work and lifestyle perks.
One big factor is the growing demand for rental properties, highlighted by the jump in Airbnb listings, which hit 1,273 by September 2024. This shows a clear interest in both short-term and long-term rentals, especially among professionals who want to be close to their jobs and enjoy the local amenities.
Urbanization is another driver, with more people moving to city centers for job opportunities. While we don't have specific numbers for Arequipa's business districts, this trend mirrors what's happening in other Peruvian cities like Lima and Trujillo. As more folks head downtown for work, the need for housing naturally goes up.
Arequipa's Historic Centre is a magnet for its vibrant culture and history, featuring spots like the Plaza de Armas and Santa Catalina Monastery. These attractions make the city center a desirable place to live, boosting the demand for rentals. The median occupancy rate for short-term rentals is 45%, indicating that central properties are hot commodities, which can push rents higher.
Living in the city center means easy access to work and leisure, a combo that's hard to resist. As more professionals seek this balance, the competition for rental spaces intensifies, nudging prices upward.
With the influx of professionals, the city center is buzzing with new energy and opportunities. This shift not only enhances the local economy but also fuels the demand for convenient living spaces, making it a prime spot for rental investments.
13) Suburban rents may dip slightly as property availability increases
Arequipa's suburban housing market is booming thanks to a surge in construction driven by economic growth, especially in mining.
With all these new homes popping up, vacancy rates in the suburbs are climbing. There are simply more rental units than people looking to rent, which means landlords are starting to lower rents to fill those empty spaces.
The government has been busy too, pouring money into infrastructure to make suburban living more attractive. Better roads and amenities are luring folks away from the city, but this is also adding to the rental oversupply in these areas.
Other Peruvian cities, like Trujillo, are seeing the same thing. Rental prices are dropping due to too many available properties and not enough renters. This pattern hints that Arequipa's suburbs might soon see a similar dip in rents.
Sources: Urban expansion and informality in Arequipa, Peru
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility.